Bank of India — Combination C-2020/12/804

Notice under Section 6 (2) of the Competition Act, 2002 filed by Bank of India

CORAM:

Mr. Ashok Kumar Gupta Chairperson Ms. Sangeeta Verma Member Mr. Bhagwant Singh Bishnoi Member

Order under Section 31(1) of the Competition Act, 2002

1. On 31st December 2020, the Competition Commission of India (‘Commission’) received a notice under Section 6(2) of the Competition Act, 2002 (‘Act’), filed by Bank of India (‘BOI/Acquirer’). The notice was filed pursuant to the execution of Share Purchase Agreement dated 2nd December 2020 amongst BOI, AXA Investment Managers, AXA Investment Managers Asia Holdings Pvt. Ltd. (‘AXA IM Asia’), BOI AXA Investment Managers Private Limited (‘BOI AXA IM’), and BOI AXA Trustee Services Private Limited (‘BOI AXA TS’).

2. The Proposed Combination contemplates acquisition of BOI AXA IM and BOI AXA TS by BOI [Hereinafter, BOI AXA IM and BOI AXA TS are collectively referred to as ‘Targets’] [Acquirer and Targets are collectively referred to as ‘Parties’]

3. BOI and AXA Investment Managers through their investment company AXA IM Asia have a Joint Venture (‘JV’) in mutual fund business, viz. BOI AXA Mutual Fund (‘BOI AXA’), in India. BOI AXA consists of two companies, viz. (i) BOI AXA IM, and (ii) BOI

AXA TS. These provide asset management and trustee services to BOI AXA, respectively.

4. BOI presently holds 51% of the paid-up equity share capital of the Targets. The remaining 49% is held by AXA IM Asia.

5. In terms of Regulations 14(3) of the Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011, vide communication dated 14th January 2021, the Acquirer was required to furnish certain information and clarifications. In response, the Acquirer filed its written submission on 20th January 2021.

6. The Proposed Combination relates to acquisition of 49% of the total share capital of BOI AXA IM and BOI AXA TS by BOI. Post the Proposed Combination, 100% of the share capital of both the said companies will be held by BOI resulting in the Acquirer becoming the sole owner of the Targets and the sole sponsor of BOI AXA.

7. The Acquirer is in the market of Mutual Fund through the Targets. Apart from this, the Acquirer does not hold equity stake in any other mutual fund. It is observed that market share of the parties in mutual fund business is not significant. Even if one were to segment mutual fund into equity oriented mutual funds, debt oriented mutual funds and hybrid mutual funds, the market shares of the Parties still remain insignificant. Mutual funds and their distribution are also characterised by presence of several other players such as HDFC Bank, State Bank of India, Axis Bank and ICICI Bank.

8. Considering the material on record including the details provided in the notice and the assessment of the Proposed Combination based on the factors stated in Section 20(4) of the Act, the Commission is of the opinion that the Proposed Combination is not likely to have any appreciable adverse effect on competition in India. Accordingly, the Commission approves the Proposed Combination under Section 31(1) of the Act.

9. This order shall stand revoked if, at any time, the information provided by the Acquirer is found to be incorrect.

10. The information provided by the Acquirer shall be treated as confidential in terms of and subject to provisions of Section 57 of the Act.

11. The Secretary is directed to communicate to the Acquirer accordingly.